BIG KNOB VOLUNTEER FIRE COMPANY v. LOWE & MOYER GARAGE (01/23/85)

NO. 02930 PHILA. 1982, Appeal from the Order in the Court of Common Pleas of Lehigh County, Civil No. 80-C-1475

COUNSEL

Robert W. Lewis, Jr., Ambridge, for appellant.

Thomas R. Elliott, Jr., Easton, for appellee.

Spaeth, President Judge, and Beck and Tamilia, JJ.

Author: Spaeth

[ 338 Pa. Super. Page 260]

This is an action in replevin for possession of a fire truck. Appellant, plaintiff below, claims the better right to possess the truck under Section 2403(b) of the Uniform Commercial Code, 13 Pa.C.S. § 2403(b), which provides that a merchant entrusted with possession of goods has "power to transfer all rights of the entruster to a buyer in ordinary course of business."*fn1 The trial court held that appellant was not a buyer in ordinary course of business because "no actual sale to [appellant] occurred." Slip op. of trial ct. at 5. We hold that for one to become a buyer in ordinary course of business, it is not necessary that a sale occur, and that on the facts of this case, appellant became a buyer in ordinary course of business when its name was placed on the fire truck, thereby identifying the truck to the contract

[ 338 Pa. Super. Page 261]

for its sale. This conclusion, however, is not dispositive. Section 2716(c) of the Uniform Commercial Code, 13 Pa.C.S. § 2716(c), provides that "[t]he buyer has a right of replevin for goods identified to the contract if . . . the circumstances reasonably indicate" that an effort to cover the goods would have been unavailing. The trial court made no finding on whether the circumstances here did so indicate. We therefore reverse and remand for further proceedings.*fn2

On March 26, 1979, appellant, the Big Knob Volunteer Fire Department, agreed to purchase a fire truck from Hamerly Custom Productions, Inc., which was in the business of assembling various component parts into fire trucks. Two days later, the Volunteer Fire Department paid Hamerly $10,000 toward the purchase price of the fire truck. After a modification in the specifications, which increased the purchase price to $51,836, the Volunteer Fire Department paid Hamerly $38,000 more toward the purchase price.

The contract for the fire truck provided that Hamerly would order the chassis for the truck, and would complete and deliver the truck within 20 to 70 days after receiving the chassis. The contract also provided:

The title [to the fire truck] does not pass to Buyer until the purchase price is paid in full. The Buyer grants Seller a security interest in the fire apparatus [truck] until paid in full. Seller retains all rights and remedies afforded under the uniform commercial code and its pertinent sections.

Complaint, Exhibit A.

On April 5, 1979, Hamerly ordered the chassis from appellee, Lowe & Moyer Garage, Inc., which in turn ordered it from the International Harvester Company. In September 1979 International Harvester delivered the chassis to Lowe & Moyer, reserving a security interest in the chassis, and

[ 338 Pa. Super. Page 262]

obtaining a note in its favor for the purchase price. This note was assigned to International Harvester Credit Corporation, as Lowe & Moyer's "floorplanner," and reassigned to the First National Bank of Allentown.*fn3 On October 17, 1979, Lowe & Moyer delivered the chassis to Hamerly.

Hamerly began work on transforming the chassis into a fire truck, and at some point, painted the Volunteer Fire Department's name on the cab. However, Hamerly neither paid Lowe & Moyer for the chassis, nor did it complete and deliver the truck to the Volunteer Fire Department, with the result that both Lowe & Moyer and the Volunteer Fire Department sued Hamerly. In April 1980 Hamerly surrendered the truck to Lowe & Moyer, whereupon Lowe & Moyer discontinued its action against Hamerly. On its action against Hamerly, for specific performance, the Volunteer Fire Department obtained a default judgment. It then brought the present action for replevin of the fire truck against Lowe & Moyer and Hamerly. The trial court found in favor of Lowe & Moyer, for the chassis or its value, and the Volunteer Fire Department took this appeal.*fn4

The Uniform Commercial Code preserves a buyer's right of replevin:

The buyer has a right of replevin for goods identified to the contract if after reasonable effort he is unable to effect cover for such goods or the circumstances reasonably indicate that such effort will be unavailing, . . . . § 2716(c).

It is clear that the Volunteer Fire Department was a "buyer" of the fire truck, for the Code defines a "buyer" as "[a] person who buys or contracts to buy goods."

[ 338 Pa. Super. Page 263]

§ 2103(a) (emphasis added). It is also clear that the truck was "identified to the contract." Identification occurred when Hamerly painted the Volunteer Fire Department's name on the cab. § 2501(a)(2). Two issues remain, however. The first issue is whether the Volunteer Fire Department, as plaintiff in replevin, sustained its burden to prove that it has a better right to possess the fire truck than Lowe & Moyer. Robinson v. Tool-O-Matic, Inc., 216 Pa. Super. 258, 263 A.2d 914 (1970). The second issue is, if the Volunteer Fire Department did prove its better right to possession, did it also prove, either that ...

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